You could consider 2018 an important year for location data. For one, marketers finally began to understand the impact location-based insights have on marketing programs—more than 80% of marketers plan to boost their use of location data over the next two years to seek greater insights into how consumers interact with businesses, according to a study conducted by 451 Research.
In the US alone, by 2022, it is expected that location-based advertising spend will reach $38.7BN—a 75% increase from 2018’s spend of $22.1BN. Comparatively, spend on traditional advertising and marketing in the US is expected to fall 0.8% in 2019.
Further, for better or worse, location data is dominating headlines due in large part to GDPR in Europe and similar proposals in the United States on a state level, all leading to heightened consumer awareness about personal data. This is likely to continue through the new year with business leaders like Facebook and consumers alike demanding the US come to some sort of national agreement.
Because of this, as we move into 2019, how we use and interact with location data will continue to transform. Let me elaborate.
Mobile ad spend will continue to explode
It is no secret that the ways in which people access information have undergone a revolution over the last decade. As a result, investment in mobile is exploding as people are relying on these devices more and more as their primary information access point.
2019 will mark a major shift in screen preference with people spending more time on mobile devices than watching TV, according to a recent eMarketer study. With the explosion of 5G networks and devices in 2019 inevitable, this divide will likely grow larger, and quickly. As marketers work to meet people where they are, mobile ad spending in the US will surpass TV ad spending by more than $6B this year and is estimated to reach $113.2B by 2020, accounting for 43% of all media ad spending in the US. This shift is here to stay.
Location data use will expand
Gartner predicts that, by 2022, 30% of customer interactions will be influenced by real-time location analysis (up from 4% in 2017). Location data already is, and will continue to be, a growing component of all business data. But rather than adding to the complexity of the data landscape, location has the power to bring order to it. We are already seeing location data integrated with planning, research, and strategy across industries.
This will only continue to grow—half of all data and analytics projects will include location data as a key data source by the year 2023, up from a third of D&A projects today. Much like how industries are finding additional uses for blockchain outside of crypto, location data is showing its value outside of use by traditional marketers thanks to these increased insights.
Transparency will be crucial
Businesses will need to change how they approach and talk about data—in fact, they’re already doing it overseas thanks to GDPR. In the US, similar policies are being considered at the state level, like the California Consumer Privacy Act, which goes into effect in 2020. Until the federal government enacts a more widespread regulation, it is up to individual companies to make their own policies and they should. Doing this before you have to not only builds consumer confidence and goodwill, but also could save companies from having to scramble once laws are set.
I think as a rule going forward, companies will need to be much clearer about their opt-in policies–not just to meet likely future regulations but more so because of increased pressure to be clear about how data is used. Consumers will demand it. With this mounting pressure, brands need to work even harder to gain and keep their customers’ trust and earn their business.
The next year will see a marked shift for location data. As consumers and businesses alike see more value and additional uses for this data, industry growth will continue to increase exponentially. Until regulations are put in place to increase security and transparency, it will be up to businesses to institute their own best practices. Location data is here to stay, and the implications for the future of marketing, and other industries as well, are very exciting.
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